Odisha may offer Posco JV option with OMC

In a last minute effort to salvage the beleaguered USD-12 billion steel project of South Korean steel major Posco near Paradip in Odisha’s Jagatsingpur district, the state government today offered Posco with the option of a joint venture (JV) with the state-run Odisha Mining Corporation (OMC) at today’s tripartite meeting, sources said.

Sources further said both Prime Minister Narendra Modi and Odisha Chief Minister Naveen Patnaik do not want Posco to leave India and it was decided during the meeting that Odisha will again talk to Posco and look for options that can save the largest FDI in India so far.

Today’s tripartite meeting was held against the backdrop of Posco announcing to freeze its Paradip project. The Odisha government had requested the Centre to fix a tripartite meeting with representatives of Posco to make its stand clear on the Paradip project.

Besides, the Centre has also told Posco to try other options like forming a JV with PSUs such as SAIL for setting up the plant, sources revealed.

The proposed project has been stalled for about a decade due to various regulatory hurdles, including delay in land acquisition and mining leases.

Under the amended MMDR Act-2015 Posco has to participate in auction in order to avail mines.

Chief Minister Naveen Patnaik and Union Finance Minister Arun Jaitley are likely to have a meeting with Posco’s representative in New Delhi in the first week of September in a bid to break the deadlock, Bhatruhari Mahtab, leader of the BJD parliamentary party in the Lok Sabha had said on Sunday.

Posco’s steel plant project near Paradip was stuck in a decade-long regulatory quagmire starting from land acquisition to getting raw material linkage to the proposed plant.

The South Korean company had signed a memorandum of understanding (MoU) with the state government on June 22, 2005.